China's top brokerage CITIC sees first-quarter profits surge on stock market rebound

FILE PHOTO: A CITIC Securities logo is seen at a building where its branch is located in Beijing, China, March 23, 2016. REUTERS/Kim Kyung-Hoon/File Photo

SINGAPORE/BEIJING (Reuters) - China’s biggest brokerage, CITIC Securities Co Ltd, reported a 58 percent rise in first-quarter profit on Monday, as investment returns surged on the back of a rally in Chinese stock markets.

The upbeat performance comes amid optimism that the world’s No.2 economy may be starting to stabilize - after seeing its slowest growth in almost three decades last year - as Beijing has announced billions of dollars in additional tax cuts to prop up consumer spending this year and keep liquidity ample.

CITIC said its net profit for January through March rose to 4.26 billion yuan ($633 million) from 2.69 billion yuan a year earlier.

Its investment income jumped by nearly 19 times to 4.60 billion yuan from 231.57 million yuan a year earlier.

China’s blue-chip CSI300 share index has surged about 30 percent this year, and the benchmark Shanghai Composite index rose to its highest close in nearly 13 months in April, Refinitiv data showed.

CITIC’s net fee and commission income declined 3 percent in the first quarter to 4.34 billion yuan.

Last month the brokerage reported an 18 percent fall in 2018 net profit amid a weak domestic stock market.

Reporting By Shu Zhang in Singapore and Cheng Leng in Beijing; Editing by Himani Sarkar and Susan Fenton